Daniel Loeb

Daniel Loeb

Last Update: 2014-11-14

Number of Stocks: 41
Number of New Stocks: 11

Total Value: $8,714 Mil
Q/Q Turnover: 26%

Countries: USA
Details: Top Buys | Top Sales | Top Holdings  Embed:

Daniel Loeb Watch

  • Daniel Loeb Comments on Sony Corp

    In May of 2013, Third Point announced a significant stake in Sony (SNE) and suggested to the company’s CEO, Kazuo Hirai, that he should seriously consider spinning out 15‐20% of the company’s undervalued, American-based Entertainment business. At the time, we explained that partially listing the Entertainment segment would have three positive effects: 1) highlighting its profitability; 2) increasing investor transparency, thereby allowing the market to properly benchmark the company against its global media peers; and 3) incentivizing Entertainment’s management to run the company more efficiently by engaging in cost cutting and laying out clear earnings targets.


    While, regrettably, the Company rejected our partial spin-out suggestion, they made some changes that were consistent with our goals. In the Entertainment business in particular, Sony has cut costs, improved its dialogue with investors, and undertaken key management changes. In Electronics, Mr. Hirai’s team deserves credit for transitioning away from personal computers this year and improving television profitability in 2015. They have also improved investor transparency. Still, they have a long way to go and we continue to believe that more urgency will be necessary to definitively turn around the company’s fortunes.

      


  • Daniel Loeb Comments on Alibaba Group Holding Ltd

    In our Quarterly Letter two and a half years ago, we argued “the Case for Alibaba.” At the time, Alibaba (BABA) held a leading market position that it was just beginning to monetize (the company had less than $75 million in LTM earnings). Today, the Company has continued its exponential growth, demonstrated significant margin leverage, and is expected to earn over $5 billion this fiscal year. Our enthusiasm for the Alibaba story has underpinned multiple investments at Third Point and now that the company is public, we have established a significant direct investment in Alibaba shares.


    Third Point has met with management several times and is confident that Alibaba can generate long‐term value in its core markets and compete in new ones, making it a compelling potential multi‐year investment. The company has a substantial network effect that creates several large moats around its business, generating significant free cash flow for re‐investment and expansion as well as an unrivaled amount of data on Chinese consumers. We see continued end market growth in Chinese consumer spending and e‐ commerce (as well as global e‐commerce) and continue to believe that Alibaba has considerable additional monetization potential.

      


  • Daniel Loeb Comments on eBay

    We established a significant position in eBay (EBAY) during the Third Quarter. While eBay’s challenges were well‐mapped – including multiple years of minimal value growth, a weak execution track record, and high employee turnover – we sensed it had arrived at a critical inflection point and gained new focus. A meeting with CEO John Donahoe this summer left us impressed by his process‐driven approach to optimizing the business.


    We were pleased when Mr. Donahoe announced in September that eBay would split into two by spinning off its PayPal unit. Our work on Alibaba (BABA) since 2011 had persuaded us of the power of the marketplace model in e‐commerce and our work on AliPay convinced us that PayPal was an incredibly well‐positioned global brand with the potential to become a leading player in mobile payments. Following the spinoff, eBay/PayPal will offer two appealing growth, relative value, and capital return profiles for investors.

      


  • Daniel Loeb Comments on Amgen Inc

    Since its founding in 1980, Amgen (AMGN) (“the company”) has been a pioneer in the biotechnology industry, successfully discovering, developing, and marketing therapeutic agents that have meaningfully impacted human health. From 1989 to 2002, Amgen grew five revolutionary biologic drugs into billion dollar blockbuster products in oncology, nephrology, and inflammation. Today, Amgen is a $105 billion market cap company with annual revenues of nearly $20 billion and annual net income e of over $5billion.


    Considering this track record, Amgen’s long‐term underperformance relative to its biotech peers is surprising. The company has a compelling mix of long‐duration, high‐margin mature products like Neulasta and Enbrel, and a number of exciting high growth assets, including recently launched blockbusters like Prolia and Xgeva along with innovative late-stage pipeline assets like evolocumab. Yet, using nearly any valuation metric, the Company trades at a substantial discount to peers. Amgen even trades at a discount to the US pharmaceutical sector, despite superior revenue and earnings growth rates. Amgen’s current discount to fair valuation – and the lack of structural hurdles to closing this gap – make it an attractive investment opportunity. Third Point is now one of the company’s largest shareholders.

      


  • Third Point Q3 2014 Investor Letter

    This is the excerpt from the shareholder letter of Third Point Capital.


    Going forward, we expect that the US will remain the best place to invest, credit opportunities will stay slim, and large cap opportunities with a constructivist angle will become more promising. Although consensus has shifted to lower growth, slower inflation, modest rates, and continued monetary expansion, we think the markets will resume an overall upward trajectory in the US through year‐end.

      


  • Daniel Loeb's New Stocks

    Dan Loeb is CEO of Third Point LLC, founded in 1995, where he oversees all investment activity. Third Point describes its underlying strategy as “event-driven, value-oriented,” and says it “seeks to identify situations where we anticipate a catalyst will unlock value,” on its website.

      


  • Which Is The Better Buy?: Einhorn's Greenlight Re or Loeb's Third Point Re

    Within the past week both Greenlight Re (GLRE) and Third Point Re (TPRE) released their second quarter earnings for 2014. The reinsurance companies both have investing gurus we follow running the investment portfolios. David Einhorn handles the portfolio for Greenlight Re, and Daniel Loeb is in charge of Third Point Re’s portfolio. Einhorn and Loeb started their long/short hedge funds in the mid-1990s and have had annual gains of about 20 percent each since inception.


    The two reinsurance companies are ways to gain access to the hedge funds while potentially receiving even higher returns if the insurance underwriting businesses are profitable. The metric that insurance companies use to measure underwriting profits is the combined ratio. A combined ratio of 100 indicates break even and the lower the number, the more profitable the underwriting business is. Greenlight Re and Thirdpoint Re are both relatively new companies, and it takes time to establish the insurance business so it can provide consistent underwriting profits. Greenlight Re has already reached the point of consistent profits, but Third Point Re is still developing its business and is not yet there.

      


  • Global Market Valuations And Expected Returns - August 6, 2014

    In January 2014, the U.S. stock market benchmark S&P 500 lost 3.36% after the excellent 2013. The enthusiasm went back as the market gained 4.31% over February. In March, it went up only 0.69%. In April, it was about even for the whole month. In May, the market gained 2.10% and in June, the market benchmark S&P 500 went up 1.91%. However, in July, the market went down by 1.51%.


    What is the situation in the other parts of the world? In July, the key indexes in Europe had negative return figures. Germany’s DAX index declined 4.33%. France’s CAC-40 index lost 4.00%. The FTSE 100 index moderately went down by 0.20%. Stock markets performances in Asia were very strong. Japan’s NIKKEI 225 gained 3.03%. Hong Kong’s Hang Seng Index surged 6.75% and China’s SSE Composite index surged 7.48%.

      


  • Third Point Comments on Royal DSM NV

    Over the past three years, Royal DSM NV (“DSM”) has transformed itself into a leading global life sciences company focused on health and nutrition with ~$12 billion of sales and ~$1.7 billion of EBITDA. DSM’s portfolio of businesses also includes legacy activities in materials sciences. While the Materials segments account for ~55% of sales, their profit contribution to the DSM group (~30% of EBITDA) has been greatly surpassed by that of the Nutrition segment (~70% of EBITDA). Earlier this year, DSM shares sold-off following: i) a profit warning in the Nutrition segment, and ii) growing skepticism about DSM’s ability to execute on its plan to divest its commodity caprolactam business. The weakness in DSM’s share price served as an opportunity to build our position. We believe that the profit warning in Nutrition was driven by cyclical factors and abnormally adverse weather rather than any structural changes in the underlying fundamentals. We are also optimistic that management can successfully separate its commodity caprolactam exposure through either a sale or joint venture. Finally, near-term trends are positive in both of DSM’s businesses, with Nutrition starting to show signs of reverting to a more normalized growth rate and Performance Materials starting to inflect from depressed levels given its exposure to rebounding European automotive and construction markets.


    DSM group currently trades at 7.5x forward EV/EBITDA. Based on our analysis, we believe that both the Nutrition and Performance Materials segments should command higher multiples than DSM’s current group multiple. The low group valuation is driven by the continued presence of the Performance Materials and Polymer Intermediates segments. These businesses have de minimis end-market overlap or synergies with Nutrition. Furthermore, the non-nutrition businesses are structurally more volatile and have lower returns, making the combined entity cumbersome for investors to analyze and appropriately value.

      


  • Daniel Loeb’s Third Point Second Quarter 2014 Investor Letter

    Review and Outlook


    Markets moved higher in the first half of 2014, despite an early sell-off in heavily-owned hedge fund names and popular technology stocks. While investors perceived the market as volatile, the +7% return for the first half largely exceeded expectations.

      


  • Einhorn Is Transforming BioFuel Energy Into A Profitable Real Estate Company

    Two of the gurus that I follow at GuruFocus are David Einhorn and Daniel Loeb. They are both considered to be activist investors and their hedge funds have experienced extraordinary results. Loeb started Third Point Capital in 1995 and Einhorn started Greenlight Capital in 1996. Third Point Capital has returned 20.4 percent annulized since its inception in 1995, and Greenlight Capital has returned 19.5 percent annualized since May of 1996.


    Together they hold 52.8 percent of BioFuel Energy Corp (BIOF) with Einhorn holding 35.4 percent and Loeb holding 17.4 percent of the shares outstanding (including B Shares) according to the Form S-1 filed with the SEC on 7/16/2014. BioFuel is going through some major changes and will be reinventing itself as a real estate company. With the exceptional track record of the two hedge fund managers, Biofuel Energy is going to be a stock to keep an eye on.

      


  • Gain Access to Daniel Loeb’s Hedge Fund Through Third Point Re

    Through my research of Greenlight Re (GLRE), I discovered Third Point Reinsurance (TPRE). Third Point Re was listed as the most similar, publicly traded competitor to Greenlight Re. The company is a way to gain access to Daniel Loeb’s hedge fund without needing the typical $1 million to invest in such a fund. Loeb has been one of the best performing gurus that we follow at GuruFocus. Third Point’s funds have blown away the S&P 500 over the years. The Master Fund has provided an annual return of 20.4 percent since inception in 1995 compared to the S&P 500’s annual return of 9.7 percent.


      


  • Can Loeb Reinvigorate Sotheby’s?

    Now that Third Point LLC’s founder and CEO, Daniel Loeb, and the board of Sotheby’s (BID) have come to an agreement, is now the time to buy the stock? There is currently an opportunity to buy it at a lower price than Loeb. He currently has 6.35 million shares valued at valued a little under $260 million. His average purchase price is $43.91 with his purchases starting in February of 2013. The stock is now trading for about 7 percent less at $40.76.


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  • Daniel Loeb Comments on SoftBank Corp

    SoftBank Corp. (TSE:9984)("SoftBank") Update Following its strong rally at year‐end, SoftBank shares pulled back 15% during Q1 2014. We believe this pullback was due to technical trading and that SoftBank's fundamentals are stronger than when we initiated the position during the fourth quarter of 2013. SoftBank has continued to demonstrate significant value growth in key drivers across each of its underlying businesses. The Japanese wireless segment successfully navigated the temporary impact of NTT's iPhone offering and seasonal promotional activity in March 2014, while consensus valuations for Alibaba Group have grown from $120 billion to $171 billion year‐to‐date. These trends play into the four‐pronged equity value expansion story for SoftBank shares:


    1) SoftBank Mobile value expansion of ¥230 per share annually (EBITDA growth, constant multiple)

      


  • Daniel Loeb Comments on IHI Corporation

    Equity Position: IHI Corporation ("IHI")(TSE:7013)


    IHI is a mid‐cap Japanese conglomerate exposed to three big themes: commercial aerospace, automotive fuel efficiency, and Abenomics‐led real estate reflation in Tokyo.

      


  • Third Point (Dan Loeb) Q1 2014 Letter to Investors



  • Is Liberty Global Speeding Up Too Quickly?

    Liberty Global Plc (LBTYA)’s John Malone has a track record for purchasing small and medium-sized companies, with the goal of expanding the media and communications empire. The most recent example of this strategy was seen at the beginning of the month, when the company acquired the remaining 20% of Chile’s largest cable operator VTR for 10.1 million shares ($422 million). Furthermore, to guarantee the firm’s proper management and elevate the customer experience, VTR has entered Telecom Italy’s Global Partnership Program, which should help improve operational efficiency. However, while there is no doubt about Liberty’s growth prospects, many investment gurus like Eric Mindich (Trades, Portfolio) and Daniel Loeb (Trades, Portfolio) have been reducing or selling out their shares in the company, due to lax returns on investment.


    As Scale Grows, So Does Debt

      


  • Sotheby's Response to Third Point Litigation

    NEW YORK, March 25, 2014 (GLOBE NEWSWIRE) -- Sotheby's (BID) issued the following in response to reports that Third Point has filed litigation against the Company.


    Late last year, Sotheby's adopted a one-year shareholder rights plan, which expires in October 2014 and cannot be extended beyond October 2014 without shareholder approval. It is similar to those adopted by numerous publicly traded companies facing similar situations. Sotheby's shareholder rights plan was adopted in response to rapid accumulations of significant portions of the Company's outstanding common stock, including through derivatives.

      


  • Activist Billionaire Daniel Loeb in a Battle for Control of Sotheby’s

    Daniel Seth Loeb is founder of Third Point LLC, a New York-based hedge fund. On Feb. 27, he added Sotheby's (BID) at an average price of $50.51 and on March 11, he added the stock again at an average price of $47.27. He currently holds 6.65 million shares of the stock with a current value of $293 million in his portfolio and his stake in Sotheby's is about 9.6%. So let's take a look at this company and try to explain to investors the reasons why he is betting on it.


      


  • Sotheby's Open Letter to Shareholders Regarding Third Point’s Board Nominees

    SOTHEBY’S SENDS OPEN LETTER TO SHAREHOLDERS


    • Sotheby’s Has the Right Plan and the Right Team to Continue Building Sustainable Value for Shareholders and Clients
    •   


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User Comments

Guardinvest
ReplyGuardinvest - 1 month ago
Following DOW as he puts added pressure on them to split and divest their commodity chemical business as well as increase stock buy backs. Creating a Shadow Board.



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